I don't think you are a bad person, you are just trying to get the most value for your dollar, and I think there are a lot of ways to get more bang for your eco-buck.

The downpayment on a hybrid car, for instance. Or insulating drapes for every window; or all florescent or LED light bulbs; or awnings for your south facing windows [if you have AC]...

It's not stupid to feel guilty. But it's something to feel and deal with and get over. You thought you could do something to save about a third of the energy that your tank uses. The problem with a lot of these new technologies is that the costs are front loaded. My solar electric system will be obsolete by the time it starts paying for itself, but I sure love the idea of generating all the electricity that I'll be using in my new kitchen.

According to a chart I saw, tankless and old style tanks end up costing the same over the lifetime of a tank, but if you haven't got the money to spend up front you haven't got it. And money does represent resources, and is worth conserving too. Try to remember that the tank is only about a quarter less efficient than the tankless. It does add up, but that's why new things are good for new installations--build new efficiencies into new systems.

Did the plumber's estimate include new gas pipes (mine told me that they need to be fatter)? Are any of your hot water uses not near to the water heater? Do you have several simultaneous uses for hot water? If you have yeses, that also cuts down the efficiency of changing over. Could you use this as an opportunity to save a little gas? Probably so. Will you be saving enough gas to make a really big difference? Probably not.

I agree with Oruboris. Do what you can. Be responsible and find other things you can do to make up for the gas. But don't beat yourself up over luxuries that are beyond you.

And remember the beavers. They come to a copse, cut down the trees, dam up the streams and make a pond. All the woodland creatures and habitat are displaced. Then there are no more trees and the beavers move on. The pond thrives. The dam rots and the water flows away. All the frogs and waterplants and all lose their homes. The land becomes a meadow. All kinds of grasses and plants thrive in the sunshine. Then the trees grow and they die in the shade. All the animals that snacked on those tender yummies go away. The woods gain undergrowth and birds and woodland creatures. Then the beavers come and cut the trees down. It's not that it's so bad to breathe in oxygen and breathe out carbon dioxide. It's just important to have a tree around to breath in the CO2 and breathe out the oxygen. Let go of this one, find some balance, and breathe easy.

Thanks guys. I think you are right. It is always good to have an outside perspective.

The standby losses from an insulated hot water tank are not that large, and depending on the tank location may not be really be 'losses.'

Mine is in the basement, and while I would not choose to heat with electric like the water heater, in the winter it is heating the basement, and in the summer helps warm it a little so it is not clammy.

This makes the actual cost the difference between my gas heat vs. electric.

A rather small amount in the grand scheme of things.

Organic, if this is an important ethical issue for you, I think you have to work it out yourself. These are hard decisions. I always wonder whether the actions of individual people can make much of a difference when industry, for example, continues to waste so much. I don't know. But you have to deal with your conscience yourself!

Conscientious use of water will save more money than a high-efficiency water heater, but you are probably already doing that.

You may want to consider combining heating systems. When we renovated our hot water heating system a few years ago we got a 96% efficiency boiler and hooked it up to heat domestic water in addition to the house. That may be something to plan for in the future.

My understanding is that with tankless hot water, you usually have to let the water run for a while before it turns hot. This means you are wasting water instead of gas. Something else to consider.

I checked into tankless heaters a couple years ago, and as I recall, the plumber told me that in a colder climate where the groundwater would get quite cold in winter (I'm in Ohio), the heaters were nto as efficient/useful as in the warmer parts of the country. Consumer Reports gives them mixed reviews also.

Here is a link that might be useful: Consumer Reports on tankless water heaters

You're looking at just one parameter. Any good decision has to also involve your individual needs (including financial constraints.) Rarely are there any "one size fits all" solutions---even with the developing green technology. Continue doing your conscientious everyday things (when you use your own bags at the grocery store not only are you doing your part to reduce the plastic scourge but it's a gentle reminder to the shoppers around you) and make your hot water decision based on all the criteria you need to consider and then enjoy your hot water and don't look back. Whatever you end up with will be a lot better than what you had and years from now when you replace this one you'll be getting something even better. Good luck!

We looked into it when we needed a new one two years ago and liked the concept of it but financially decided it wasn't worth it right now. Our next unit, when the prices come down and technology changes will be one :) but for now, we choose to get a regular unit as with having to rework the plumbing (and we have a small house) and venting, it just wasn't worth it and the plumber said don't bother. Plus, financially, you aren't saving that much on your gas/heating costs when you look at the extra money you save on the unit, so eco wise, you may be helping the enviroment some, but I'm not 100% convinced in less you are building a new house that is set up to handle it, it is the best choice. Now, as a single unit for an individual bathroom, etc. I would buy one but not as an entire house, if you have the space in the basement... we dreamed of one too... and it turned out to be a better concept than reality and went with Sears as we could order it online and they'd install. I figure just getting a new unit has to help the enviroment as our clearly wasn't working properly!

We installed a recirculating pump, so when it is on, we don't have to run the "hot" water for several minutes waiting for it to get hot. We have it on a switchable timer, so it's only running at our most likely usage time, yet we can always switch it on or off.

i think there are an endless amount of things you could feel guilty about.. my inlaws are huge into reuse/recycling, but they keep their house at 78 degrees during the winter. my step-father drives an SUV, but he normally only drives it 2 miles to the train station (vs. my husband who drives his car all the way into the city).

So, I think you should keep your budget in mind and maybe make an adjustment in another area of your life if the guilt is too much to take ;o)

I can see where you are coming from, though.